"Why bitcoin sucks" (An Ironic Piece from Keynesian perspective)

[altoidmintz]

Latest article on my blog based on numerous critiques of bitcoin from the keynesian perspective. Hopefully you find it both insightful and funny:

http://thegenerallifeblog.blogspot.com/2013/05/why-bitcoin-sucks.html

[1715271037]

1715271037

[1715271037]

1715271037

[BitcoinBarrel]

Two words: Gene Yes!

[Questing]

Thank you, great write up. Keynesian economics has proven very useful in the past. I don't think anybody could argue it hasent. And your ironic piece makes a case well worth consideration.

Perhaps the useful aspects of Keynesian economics can still be adapted for use with bitcoin. For example, gov can still hold btc and increase spending during recession. And it can still create policy that encourage spending, licenses, tax incentives etc. And btc can still be taxed, even if it is harder to trace earnings. Tax is basically an honest system now, requiring that we self report our earnings. Most people will still do the right thing.
But Governments cant print more, or de-value btc. Time will tell if that's a good or bad thing. I'm no expert, but I'm leaning toward it being a good thing.

I think the biggest problem our financial system presents, is not that its failing, or problems of adapting to a new type of currency (btc). I think the biggest problem is our markets only work if they are expanding, driving gov policy toward population growth, and ever increasing exploitation of earths resources. I wonder if btc could somehow become part of a new system structure which was able to maintain steady state, rather than perpetual growth. Afterall, perpetual growth is impossible in a finite world, so if we don't want to bust, we need to solve this issue.
I don't personally know how btc could achieve this, but it certainly has a whole new set of possibilities which haven't been considered before.  

[cypherdoc]

I wonder if btc could somehow become part of a new system structure which was able to maintain steady state, rather than perpetual growth. Afterall, perpetual growth is impossible in a finite world, so if we don't want to bust, we need to solve this issue.
I don't personally know how btc could achieve this, but it certainly has a whole new set of possibilities which haven't been considered before.  

easy.

establish a Bitcoin Standard based on the Gold Standard that existed prior to 1971.

[hugolp]

Thank you, great write up. Keynesian economics has proven very useful in the past. I don't think anybody could argue it hasent. And your ironic piece makes a case well worth consideration.

Perhaps the useful aspects of Keynesian economics can still be adapted for use with bitcoin. For example, gov can still hold btc and increase spending during recession. And it can still create policy that encourage spending, licenses, tax incentives etc. And btc can still be taxed, even if it is harder to trace earnings. Tax is basically an honest system now, requiring that we self report our earnings. Most people will still do the right thing.
But Governments cant print more, or de-value btc. Time will tell if that's a good or bad thing. I'm no expert, but I'm leaning toward it being a good thing.

I think the biggest problem our financial system presents, is not that its failing, or problems of adapting to a new type of currency (btc). I think the biggest problem is our markets only work if they are expanding, driving gov policy toward population growth, and ever increasing exploitation of earths resources. I wonder if btc could somehow become part of a new system structure which was able to maintain steady state, rather than perpetual growth. Afterall, perpetual growth is impossible in a finite world, so if we don't want to bust, we need to solve this issue.
I don't personally know how btc could achieve this, but it certainly has a whole new set of possibilities which haven't been considered before.  

I dont see how anyone would think that keynesianism has been useful. And more importantly economics is supposed to be a science, so it should be correct not useful and keynesianism has been proven false again and again.

I tried having a debate with some keynesians who were claiming Bitcoin would not succed because keynesianism and they could not handle it, so I extend the offer to you. But by debate I dontmean an internet slogan-catchy phrases ridiculous back and forth, I mean an honest exchange of ideas.

[Questing]

I wonder if btc could somehow become part of a new system structure which was able to maintain steady state, rather than perpetual growth. Afterall, perpetual growth is impossible in a finite world, so if we don't want to bust, we need to solve this issue.
I don't personally know how btc could achieve this, but it certainly has a whole new set of possibilities which haven't been considered before.  

easy.

establish a Bitcoin Standard based on the Gold Standard that existed prior to 1971.

I have an inkling you have something interesting to say. Can you please elaborate on btc standard, and how it might improve things?

[Questing]

I wonder if btc could somehow become part of a new system structure which was able to maintain steady state, rather than perpetual growth. Afterall, perpetual growth is impossible in a finite world, so if we don't want to bust, we need to solve this issue.
I don't personally know how btc could achieve this, but it certainly has a whole new set of possibilities which haven't been considered before.  

easy.

establish a Bitcoin Standard based on the Gold Standard that existed prior to 1971.

I have an inkling you have something interesting to say. Can you please elaborate on btc standard, and how it might improve things?

[Questing]

Thank you, great write up. Keynesian economics has proven very useful in the past. I don't think anybody could argue it hasent. And your ironic piece makes a case well worth consideration.

Perhaps the useful aspects of Keynesian economics can still be adapted for use with bitcoin. For example, gov can still hold btc and increase spending during recession. And it can still create policy that encourage spending, licenses, tax incentives etc. And btc can still be taxed, even if it is harder to trace earnings. Tax is basically an honest system now, requiring that we self report our earnings. Most people will still do the right thing.
But Governments cant print more, or de-value btc. Time will tell if that's a good or bad thing. I'm no expert, but I'm leaning toward it being a good thing.

I think the biggest problem our financial system presents, is not that its failing, or problems of adapting to a new type of currency (btc). I think the biggest problem is our markets only work if they are expanding, driving gov policy toward population growth, and ever increasing exploitation of earths resources. I wonder if btc could somehow become part of a new system structure which was able to maintain steady state, rather than perpetual growth. Afterall, perpetual growth is impossible in a finite world, so if we don't want to bust, we need to solve this issue.
I don't personally know how btc could achieve this, but it certainly has a whole new set of possibilities which haven't been considered before.  

I dont see how anyone would think that keynesianism has been useful. And more importantly economics is supposed to be a science, so it should be correct not useful and keynesianism has been proven false again and again.

I tried having a debate with some keynesians who were claiming Bitcoin would not succed because keynesianism and they could not handle it, so I extend the offer to you. But by debate I dontmean an internet slogan-catchy phrases ridiculous back and forth, I mean an honest exchange of ideas.

Honest exchange of ideas? Sounds fine, thanks for the offer. Who knows, we might even find we agree on some things.
Firstly, I dont believe Keynesian economics has all the answers, so I certainly wouldn't label myself a keynesian. And I do believe btc can succeed, and I hope it does.
But spending gov money to stimulate the economy, I suggest can be useful at times?
Economics is a science, like weather forecasting is a science. There are so many shifting variables, including human behavior, so our scientific inquiry has limits. Perhaps it is fairer to say that economics is part science, part art?

If you have an economics model which is not just useful, but fully scientifically correct. Then plz do tell us about it?

[hugolp]

Thank you, great write up. Keynesian economics has proven very useful in the past. I don't think anybody could argue it hasent. And your ironic piece makes a case well worth consideration.

Perhaps the useful aspects of Keynesian economics can still be adapted for use with bitcoin. For example, gov can still hold btc and increase spending during recession. And it can still create policy that encourage spending, licenses, tax incentives etc. And btc can still be taxed, even if it is harder to trace earnings. Tax is basically an honest system now, requiring that we self report our earnings. Most people will still do the right thing.
But Governments cant print more, or de-value btc. Time will tell if that's a good or bad thing. I'm no expert, but I'm leaning toward it being a good thing.

I think the biggest problem our financial system presents, is not that its failing, or problems of adapting to a new type of currency (btc). I think the biggest problem is our markets only work if they are expanding, driving gov policy toward population growth, and ever increasing exploitation of earths resources. I wonder if btc could somehow become part of a new system structure which was able to maintain steady state, rather than perpetual growth. Afterall, perpetual growth is impossible in a finite world, so if we don't want to bust, we need to solve this issue.
I don't personally know how btc could achieve this, but it certainly has a whole new set of possibilities which haven't been considered before.  

I dont see how anyone would think that keynesianism has been useful. And more importantly economics is supposed to be a science, so it should be correct not useful and keynesianism has been proven false again and again.

I tried having a debate with some keynesians who were claiming Bitcoin would not succed because keynesianism and they could not handle it, so I extend the offer to you. But by debate I dontmean an internet slogan-catchy phrases ridiculous back and forth, I mean an honest exchange of ideas.

Honest exchange of ideas? Sounds fine, thanks for the offer. Who knows, we might even find we agree on some things.
Firstly, I dont believe Keynesian economics has all the answers, so I certainly wouldn't label myself a keynesian. And I do believe btc can succeed, and I hope it does.
But spending gov money to stimulate the economy, I suggest can be useful at times?
Economics is a science, like weather forecasting is a science. There are so many shifting variables, including human behavior, so our scientific inquiry has limits. Perhaps it is fairer to say that economics is part science, part art?

If you have an economics model which is not just useful, but fully scientifically correct. Then plz do tell us about it?

No, I do agree that there is a difference between so called "social sciences" and empirical sciences. There is people who even argue that social sciences, by their own nature, should not be called sciences. I dont really care about the name and redefinitions of the word science. I do acknowledge that by strict historical standards social sciences should not be called sciences and that the extended use of the word science has been used to give credibility to certain theories that probably did not deserve it. But the new meaning is so extended at this point that its a bit useless to try to "enforce" the strict old historical definition. As long as we understand that social sciences are different than empirical sciences, I dont have a problem with the word people decide to use.

But social sciences are not art. Engineering has an "artistic" side, trading too, but social sciences are not so much about art, but about creating a theoretical body of ideas that try to reflect reality, not really about producing an effect (which is what art is).

Moving into the economic part, since you have started by bringing up the idea of government spending to (allegedly) stimulate the economy, why dont you expand on as a first topic of discussion?

[Questing]

Thank you, great write up. Keynesian economics has proven very useful in the past. I don't think anybody could argue it hasent. And your ironic piece makes a case well worth consideration.

Perhaps the useful aspects of Keynesian economics can still be adapted for use with bitcoin. For example, gov can still hold btc and increase spending during recession. And it can still create policy that encourage spending, licenses, tax incentives etc. And btc can still be taxed, even if it is harder to trace earnings. Tax is basically an honest system now, requiring that we self report our earnings. Most people will still do the right thing.
But Governments cant print more, or de-value btc. Time will tell if that's a good or bad thing. I'm no expert, but I'm leaning toward it being a good thing.

I think the biggest problem our financial system presents, is not that its failing, or problems of adapting to a new type of currency (btc). I think the biggest problem is our markets only work if they are expanding, driving gov policy toward population growth, and ever increasing exploitation of earths resources. I wonder if btc could somehow become part of a new system structure which was able to maintain steady state, rather than perpetual growth. Afterall, perpetual growth is impossible in a finite world, so if we don't want to bust, we need to solve this issue.
I don't personally know how btc could achieve this, but it certainly has a whole new set of possibilities which haven't been considered before.  

I dont see how anyone would think that keynesianism has been useful. And more importantly economics is supposed to be a science, so it should be correct not useful and keynesianism has been proven false again and again.

I tried having a debate with some keynesians who were claiming Bitcoin would not succed because keynesianism and they could not handle it, so I extend the offer to you. But by debate I dontmean an internet slogan-catchy phrases ridiculous back and forth, I mean an honest exchange of ideas.

Honest exchange of ideas? Sounds fine, thanks for the offer. Who knows, we might even find we agree on some things.
Firstly, I dont believe Keynesian economics has all the answers, so I certainly wouldn't label myself a keynesian. And I do believe btc can succeed, and I hope it does.
But spending gov money to stimulate the economy, I suggest can be useful at times?
Economics is a science, like weather forecasting is a science. There are so many shifting variables, including human behavior, so our scientific inquiry has limits. Perhaps it is fairer to say that economics is part science, part art?

If you have an economics model which is not just useful, but fully scientifically correct. Then plz do tell us about it?

No, I do agree that there is a difference between so called "social sciences" and empirical sciences. There is people who even argue that social sciences, by their own nature, should not be called sciences. I dont really care about the name and redefinitions of the word science. I do acknowledge that by strict historical standards social sciences should not be called sciences and that the extended use of the word science has been used to give credibility to certain theories that probably did not deserve it. But the new meaning is so extended at this point that its a bit useless to try to "enforce" the strict old historical definition. As long as we understand that social sciences are different than empirical sciences, I dont have a problem with the word people decide to use.

But social sciences are not art. Engineering has an "artistic" side, trading too, but social sciences are not so much about art, but about creating a theoretical body of ideas that try to reflect reality, not really about producing an effect (which is what art is).

Moving into the economic part, since you have started by bringing up the idea of government spending to (allegedly) stimulate the economy, why dont you expand on as a first topic of discussion?

I say in all respect. But your reply doesn't answer any of my questions, or address any of the points I made. All you have done is question the context in which I've used two words (science) and (Art). But I think my intended context is quite clear. You can argue weather prediction is not art if you like, but I think you'll find most people will have understood the point I was making.

As for your question, for me to expand on stimulus spending? I can do that, but first please make an attempt to answer my questions?
Respectfully, Questing

[hugolp]

I say in all respect. But your reply doesn't answer any of my questions, or address any of the points I made. All you have done is question the context in which I've used two words (science) and (Art). But I think my intended context is quite clear. You can argue weather prediction is not art if you like, but I think you'll find most people will have understood the point I was making.

As for your question, for me to expand on stimulus spending? I can do that, but first please make an attempt to answer my questions?
Respectfully, Questing

I think you have missed the part where I said I agree with your remark.

[Questing]

Thank you, great write up. Keynesian economics has proven very useful in the past. I don't think anybody could argue it hasent. And your ironic piece makes a case well worth consideration.

Perhaps the useful aspects of Keynesian economics can still be adapted for use with bitcoin. For example, gov can still hold btc and increase spending during recession. And it can still create policy that encourage spending, licenses, tax incentives etc. And btc can still be taxed, even if it is harder to trace earnings. Tax is basically an honest system now, requiring that we self report our earnings. Most people will still do the right thing.
But Governments cant print more, or de-value btc. Time will tell if that's a good or bad thing. I'm no expert, but I'm leaning toward it being a good thing.

I think the biggest problem our financial system presents, is not that its failing, or problems of adapting to a new type of currency (btc). I think the biggest problem is our markets only work if they are expanding, driving gov policy toward population growth, and ever increasing exploitation of earths resources. I wonder if btc could somehow become part of a new system structure which was able to maintain steady state, rather than perpetual growth. Afterall, perpetual growth is impossible in a finite world, so if we don't want to bust, we need to solve this issue.
I don't personally know how btc could achieve this, but it certainly has a whole new set of possibilities which haven't been considered before.  

I dont see how anyone would think that keynesianism has been useful. And more importantly economics is supposed to be a science, so it should be correct not useful and keynesianism has been proven false again and again.

I tried having a debate with some keynesians who were claiming Bitcoin would not succed because keynesianism and they could not handle it, so I extend the offer to you. But by debate I dontmean an internet slogan-catchy phrases ridiculous back and forth, I mean an honest exchange of ideas.

Honest exchange of ideas? Sounds fine, thanks for the offer. Who knows, we might even find we agree on some things.
Firstly, I dont believe Keynesian economics has all the answers, so I certainly wouldn't label myself a keynesian. And I do believe btc can succeed, and I hope it does.
But spending gov money to stimulate the economy, I suggest can be useful at times?
Economics is a science, like weather forecasting is a science. There are so many shifting variables, including human behavior, so our scientific inquiry has limits. Perhaps it is fairer to say that economics is part science, part art?

If you have an economics model which is not just useful, but fully scientifically correct. Then plz do tell us about it?

No, I do agree that there is a difference between so called "social sciences" and empirical sciences. There is people who even argue that social sciences, by their own nature, should not be called sciences. I dont really care about the name and redefinitions of the word science. I do acknowledge that by strict historical standards social sciences should not be called sciences and that the extended use of the word science has been used to give credibility to certain theories that probably did not deserve it. But the new meaning is so extended at this point that its a bit useless to try to "enforce" the strict old historical definition. As long as we understand that social sciences are different than empirical sciences, I dont have a problem with the word people decide to use.

But social sciences are not art. Engineering has an "artistic" side, trading too, but social sciences are not so much about art, but about creating a theoretical body of ideas that try to reflect reality, not really about producing an effect (which is what art is).

Moving into the economic part, since you have started by bringing up the idea of government spending to (allegedly) stimulate the economy, why dont you expand on as a first topic of discussion?

I say in all respect. But your reply doesn't answer any of my questions, or address any of the points I made. All you have done is question the context in which I've used two words (science) and (Art). But I think my intended context is quite clear. You can argue weather prediction is not art if you like, but I think you'll find most people will have understood the point I was making.

As for your question, for me to expand on stimulus spending? I can do that, but first please make an attempt to answer my questions?
Respectfully, Questing

I think you have missed the part where I said I agree with your remark.

[/quote]

Thank you. Agreement noted.

Ok, lets start again, because I would like to hear your opinion plz? You stated the following, and requested it be a topic for discussion.

"Quote"
I dont see how anyone would think that keynesianism has been useful. And more importantly economics is supposed to be a science, so it should be correct not useful and keynesianism has been proven false again and again.
"End quote"

Then I pointed out,
1. Keynesian economics is useful for its mechanism of "Stimulus spending" to avoid recession.
and
2. economics isn't an exact science due to there being so many shifting variables, including human behavior.

So now the onus is on you to justify
1. Stimulus spending is not useful.
2. And more importantly, why economics is supposed to be a science, so it should be correct not useful and keynesianism has been proven false again and again.

Ok, over to you hugolp. I look forward to receiving your comments

[shawshankinmate37927]

Economics is a science, like weather forecasting is a science. There are so many shifting variables, including human behavior, so our scientific inquiry has limits. Perhaps it is fairer to say that economics is part science, part art?

More specifically, economics is a social science.  That is to say, it is a science of human behavior.  Human behavior isn't a variable in economics.  That would be like saying mathematics is part of algebra.  In reality, economics is a part of human behavior, just as algebra, calculus, or trigonometry, is a specific study within the field of mathematics.  Economics is, at its essence, an effort to understand and explain human behavior--behavior related to the exchange of goods and services.

[Questing]

Economics is a science, like weather forecasting is a science. There are so many shifting variables, including human behavior, so our scientific inquiry has limits. Perhaps it is fairer to say that economics is part science, part art?

More specifically, economics is a social science.  That is to say, it is a science of human behavior.  Human behavior isn't a variable in economics.  That would be like saying mathematics is part of algebra.  In reality, economics is a part of human behavior, just as algebra, calculus, or trigonometry, is a specific study within the field of mathematics.  Economics is, at its essence, an effort to understand and explain human behavior--behavior related to the exchange of goods and services.

Love your profile picture by the way. Shaw shank redemption is one of my all time fav movies.

I kind of, sort of get your point. But how can human behavior not be a variable in economics, when economics is the study of human behavior? Surely that makes in variable by default? This is a mind bender. Perhaps I need to be sober to understand this!!

[datz]

I dont see how anyone would think that keynesianism has been useful. And more importantly economics is supposed to be a science, so it should be correct not useful and keynesianism has been proven false again and again.

I tried having a debate with some keynesians who were claiming Bitcoin would not succed because keynesianism and they could not handle it, so I extend the offer to you. But by debate I dontmean an internet slogan-catchy phrases ridiculous back and forth, I mean an honest exchange of ideas.

I concur. Keynesianism implies perfect logic of the market and therefore individuals in a given market.

Real markets cannot be predicted by or shaped by Keynesian economics in any specific fashion.

We need a new form of economics for the modern age.

[captemmy]

Yes some good points in there.

[shawshankinmate37927]

Economics is a science, like weather forecasting is a science. There are so many shifting variables, including human behavior, so our scientific inquiry has limits. Perhaps it is fairer to say that economics is part science, part art?

More specifically, economics is a social science.  That is to say, it is a science of human behavior.  Human behavior isn't a variable in economics.  That would be like saying mathematics is part of algebra.  In reality, economics is a part of human behavior, just as algebra, calculus, or trigonometry, is a specific study within the field of mathematics.  Economics is, at its essence, an effort to understand and explain human behavior--behavior related to the exchange of goods and services.

Love your profile picture by the way. Shaw shank redemption is one of my all time fav movies.

I kind of, sort of get your point. But how can human behavior not be a variable in economics, when economics is the study of human behavior? Surely that makes in variable by default? This is a mind bender. Perhaps I need to be sober to understand this!!

Thanks.  How about that, Shawshank Redemption happens to be my all-time favorite movie.  

Let me try a different analogy.  Say you have a pepperoni pizza.  Would it be accurate to say that the pizza is a part of the pepperoni?  Of course not.  Pepperoni is one of the parts that make up the pizza.  Or, how about a house?  Is a house part of a bathroom, or is the bathroom part of the house?  Likewise, human behavior isn't part of economics.  Economics is part of human behavior/interaction.

[HurtK]

Thank you, great write up. Keynesian economics has proven very useful in the past. I don't think anybody could argue it hasent. And your ironic piece makes a case well worth consideration.

Perhaps the useful aspects of Keynesian economics can still be adapted for use with bitcoin. For example, gov can still hold btc and increase spending during recession. And it can still create policy that encourage spending, licenses, tax incentives etc. And btc can still be taxed, even if it is harder to trace earnings. Tax is basically an honest system now, requiring that we self report our earnings. Most people will still do the right thing.
But Governments cant print more, or de-value btc. Time will tell if that's a good or bad thing. I'm no expert, but I'm leaning toward it being a good thing.

I think the biggest problem our financial system presents, is not that its failing, or problems of adapting to a new type of currency (btc). I think the biggest problem is our markets only work if they are expanding, driving gov policy toward population growth, and ever increasing exploitation of earths resources. I wonder if btc could somehow become part of a new system structure which was able to maintain steady state, rather than perpetual growth. Afterall, perpetual growth is impossible in a finite world, so if we don't want to bust, we need to solve this issue.
I don't personally know how btc could achieve this, but it certainly has a whole new set of possibilities which haven't been considered before.  

thats where i stopped reading

[altoidmintz]

Thanks for the conversation guys! This was the first time I submitted a blog directly to the forum and I appreciate the conversation...It's exactly what I meant to stir up

Glad to see our community is so supportive of us BTC bloggers! Yall motivate me to write more!

[abbyd]

Keynesian economics has proven very useful in the past. I don't think anybody could argue it hasent.

I'll take the bait.

Perhaps the useful aspects of Keynesian economics can still be adapted for use with bitcoin. For example, gov can still hold btc and increase spending during recession. And it can still create policy that encourage spending, licenses, tax incentives etc.

I believe you have internalized a number of assumptions about economies. Or, you simply haven't challenged what you've read...
Why is "government spending during recession" necessary? If you think about this, it's usually because a government has:

1) Overtaxed its citizens, and/or overburdened the productive sectors with tariffs
2) Distributed wealth unequally toward the top 1% because of monopolies and graft
3) Created huge trade imbalances and market inefficiencies

Money doesn't just disappear - if no money is circulating in the economy, it's usually because the rich are hoarding it.
Granted, printing more money "solves" this problem by devaluing the hoarders' stashes, but back in the old days the rich
started spending when they started getting eaten...

Afterall, perpetual growth is impossible in a finite world, so if we don't want to bust, we need to solve this issue.

What makes you think trying to do something impossible is a good idea? Or perhaps you're moving to a world that is not finite?